COMMODITIES : Soybean Futures Dip; Grain Futures Are Mixed

Soybean futures prices sagged and trading activity lagged Monday on the Chicago Board of Trade amid forecasts for rain in the Midwest later this week.

Grain futures finished mixed, however, reflecting uncertainty about the amount of moisture that drought-ridden croplands are likely to receive, analysts said.

On other markets, coffee futures slumped, livestock and meat were mostly lower, energy futures declined, precious metals were slightly higher and stock index futures advanced.

The Commodity Research Bureau’s index of 21 agricultural and industrial commodities retreated 1.26 points to 256.35.

Soybean futures, which hit 4 1/2-year highs above $9 a bushel last week, turned lower on reports that showers were moving eastward from the western edge of the Corn Belt.

“There is some rain coming in and the market, at least today, felt it would be beneficial” for the crops, said Victor Lespinasse, a trader for Dean Witter Reynolds Inc.

Activity was markedly lighter than in last week’s sessions, which saw grain and soybean futures prices rise dramatically as traders bet on a lengthy dry spell.

“There were a lot of traders on the sidelines today, watching, hoping and praying,” Lespinasse said.

Analyst David Bartholomew of Merrill Lynch Futures Inc. in Chicago noted a significant reduction in soybean contract purchases by commercial firms and said commercial buying interest may have peaked last week.

After the close, the National Weather Service issued a 6-to-10-day outlook calling for above-normal temperatures and normal precipitation in most major U.S. crop-growing areas during the first five days of next week.

Wheat Declines

Also after the close, the Agriculture Department reported that U.S. soybean planting was 90% complete as of Sunday, with most of the crop in fair to good condition.

The USDA reported slight deterioration in the corn crop but said most of the crop remained in fair to good condition and said 9% of the winter wheat crop had been harvested, with most of that crop also in fair to good condition.

Wheat settled 2 cents to 5 cents lower, with the contract for delivery in July at $3.6975 a bushel; corn was unchanged to 2 cents higher, with July at $2.595 a bushel; oats were 3 cents lower to 2 cents higher, with July at $2.62 a bushel, and soybeans were 2.50 cents to 8.50 cents lower, with July at $8.77 a bushel.

Coffee futures posted sharp losses on the Coffee, Sugar & Cocoa Exchange in New York in response to milder-than-expected weekend weather in Brazil, which produces about one-third of the world’s coffee.

Coffee traders had bid up prices last week on expectations of freezing temperatures during the weekend in Brazil.

A freeze would have threatened Brazil’s 1989-90 coffee crop, which is at the sensitive bud stage, but not the 1988-89 crop, which is now being harvested, said Sandra Kaul, an analyst in New York with Shearson Lehman Hutton Inc.

Coffee settled 1.75 cents to 2.23 cents lower, with July at $1.3630 a pound.

Frozen pork belly futures fell sharply for the fifth consecutive session on the Chicago Mercantile Exchange as prices continued to seek a level that will encourage sales of near-record supplies of frozen bellies on the cash market, analysts said.

Energy Futures Skid

Hog futures nearing expiration were supported by stronger cash markets. Cattle futures were pressured by weak technical and fundamental factors and by jitters about this Friday’s monthly cattle-on-feed report from the Agriculture Department.

Live cattle settled 0.37 cent to 0.78 cent lower, with June at 71.95 cents a pound; feeder cattle were 0.60 cent to 1.25 cents lower, with August at 74 cents a pound; hogs were 0.55 cent lower to 0.40 cent higher, with June at 51.55 cents a pound, and frozen pork bellies were 1 cent to 1.93 cents lower, with July at 48.35 cents a pound.

Energy futures fell in response to indications that the Organization of Petroleum Exporting Countries, meeting this week in Vienna, will take no action to reduce production of crude oil, analysts said.

West Texas Intermediate crude oil settled 10 cents to 30 cents lower, with July at $16.43 a barrel; heating oil was 0.29 cent to 0.50 cent lower, with July at 43.75 cents a gallon, and unleaded gasoline was 0.58 cent to 0.71 cent lower, with July at 48.51 cents a gallon.

Gold futures were nearly unchanged while silver advanced slightly on the Commodity Exchange in New York.

Gold settled 50 cents to 70 cents higher, with August at $453.80 an ounce; silver was 2.9 cents to 4 cents higher, with July at $7.055 an ounce.

Stock index futures advanced slightly on the Chicago Mercantile Exchange, where the contract for June delivery of the Standard & Poor’s 500 index settled 0.60 point higher at 271.70.